According to a statement released by the Finnish steelmaker Rautaruukki (Ruukki) on December 3, the company's construction and engineering divisions are to further improve and adjust their operations in Finland. The organizational structure and operating model of construction operations will be streamlined and production efficiency improved at the plants in Vimpeli, Alajärvi and Peräseinäjoki. There are plans to transfer the manufacture of engineering components from Peräseinäjoki to Ruukki Engineering's other units.
However, within the scope of the above plans, employer-employee negotiations with regard to workforce reductions and temporary layoffs are to be initiated in Ruukki Construction and Ruukki Engineering. Efficiency measures apply not only to the above production units, but also to the construction business development organization and building construction sales. A total of around 500 people are affected by the negotiations. It is estimated that a workforce reduction of a maximum of 100 people is required. The extent and duration of the layoffs will become clear as the negotiations progress.
As construction market conditions have weakened rapidly during the year, Ruukki says it is restructuring commercial and industrial construction operations in pursuit of permanent improvements whilst adjusting operations to market conditions. Engineering industry orders have been below forecasts and operations must consequently be adjusted in line with weaker demand, the company says.
Actions to improve operational efficiency and adjust operations are expected to deliver annualized permanent cost savings of around € 4.5 million and will be effected mostly during the first half of 2010.